The Reserve Bank of Australia (RBA) is set to maintain its current cash rate at 3.6% during its upcoming meeting, with the official announcement scheduled for 2:30 PM eastern time. Governor Michele Bullock will address the media at 3:30 PM to discuss the decision and provide insights into the economic landscape.
Thus, financial markets have priced in only a very small likelihood—less than 8%—of an interest rate cut happening in the near term. The ASX 30 Day Interbank Cash Rate Futures October 2025 contract at 96.41. This figure represents market expectations in line with economists’ forecasts of no movement. The RBA is preparing to make its big announcement. All eyes are now turned to the economic indicators that have led to this anticipated decision.
Market Expectations and Economic Indicators
Most economists seem to be in agreement about the RBA hitting pause on its current rate setting. There is a prevailing expectation of less than a 4% chance that the cash rate could decrease to 3.35% at the next RBA Board meeting. The central bank’s most recent minutes showed that additional easing may be needed in the year ahead. Boosting consumer spending and increasing inflation data have cooled expectations for cuts in the near term.
The RBA faces challenges in assessing its next steps, as it concluded that it could not definitively judge between two economic scenarios at this stage. Though the labour market is somewhat tight and private demand shows other signs of rebounding[^…] Taken together, these factors form a complicated stage for the decision making on monetary policy.
“Together this overwhelmingly supports a decision not to further reduce interest rates at this meeting.”
With consumer spending more resilient than expected, playing a starring role in a robust economic backdrop, upside surprises have become the order of the day. Taken together, these recent indicators point to households starting to spend money again, a factor that will be of increasing importance as monetary policymakers look ahead.
“The higher monthly CPI casts a lot of doubt on the forecast of inflation being close to target as currently forecast.”
Consumer Spending and Inflation Trends
Underlying these positive developments, the RBA is still worried about inflation. All of those forecasts expect inflation to edge above the midpoint of the target band. This is particularly alarming given the lack of price stability expected in the medium term. As it stands now, the market is pricing in a 3.5% probability of an interest rate cut. This is subject to revision as new economic data is released.
Analysts are already doubtful about any new easing this year. First, they cite stronger-than-expected consumer activity and high monthly inflation figures as primary movers behind their skepticism. A lot of people are betting on a dovish RBA. They are going to watch new data very carefully before making any future changes → 7 .
As the market awaits the RBA’s decision, anticipation builds for Governor Michele Bullock’s press conference following the announcement. At 3:30 PM, she will discuss the rationale behind the RBA’s decision and provide updates on economic assessments.
Press Conference Anticipation
Daniel Ziffer from the ABC business team humorously captured the sentiment surrounding expectations for rate cuts:
This is an indication of the thinking of many economists and market analysts. Their fundamental view therefore is that the cash rate won’t be going up anytime soon.
“Anxiously anticipating the Reserve Bank’s rates decision at 2:30 PM eastern time? Don’t waste your energy. There’s about as much chance of Satan needing an overcoat as there is of the RBA lowering its cash rate today.”
This comment encapsulates the consensus among economists and market analysts who largely foresee no immediate changes to the cash rate.
